Strong IP Encourages Innovation

Strong IP Encourages Innovation

04.29.13 | By Mark Grayson

“A strong intellectual property rights system encourages investment by millions of people in the United States and abroad to engage in ongoing innovation. This is critical for future economic growth in the United States and elsewhere. America’s founding fathers considered this to be so important that they included the legal basis for our national patent and copyright system in the U.S. Constitution,” writes Robert Hormats - Under Secretary of State for Economic Growth, Energy, and the Environment in a commentary in the Huffington Post.

We could not agree more. Under Secretary Hormats highlights the ways in which IP benefits people all over the world and why it is important for governments to do their best to protect all forms of intellectual property. World Intellectual Property Day was a great day to bring this topic to everyone. The ongoing Trans-Pacific Partnership (TPP) negotiations can provide a foundation for strong intellectual property covering a large part of world trade.

However, as Mr. Hormats also notes, “Many governments, however, still turn a blind eye to trade secret theft, counterfeiting, and piracy. Some governments also believe in ‘innovation nationalism’ which discriminates against innovators abroad. In the long-term, intellectual property theft or nationalistic innovation restrictions -- that often appear to be attractive options in the short run -- benefit no one.” In the past year, India’s deteriorating IP environment has come to typify the weak enforcement and discriminatory industrial policies Mr. Hormats describes.

Other barriers to patentability and an unwillingness to enforce against IP infringement have hurt international companies across a range of innovative industries, including biopharmaceuticals, telecommunications, and energy while propping up Indian industries, whose profits increasingly come from international markets including the U.S.

At the same time, Canadian policies and judicial opinions have harmed international innovators to the benefit of domestic industries across a similarly diverse range of sectors. Canadian regulators have, for example, created a discriminatory right of appeal regime under which Canadian medicine manufacturers challenging the validity of a medicine patent may appeal an adverse decision while innovative international biopharmaceutical companies cannot.

The current Trans-Pacific Partnership (TPP) negotiations can provide a foundation for strong intellectual property covering a large part of world trade, and a remedy for ongoing industrial policies that deter innovation and ultimately harm patients and consumers worldwide. We can only believe that countries such as India and Canada will recognize that strong IP is in the interest of their people.

And we hope that Mr. Hormats’s words are heeded as all countries need a strong intellectual property system to foster economic development and growth.